Assistant Treasurer Daniel Mulino Admits He Knew of ATO Credit Card Ban Plans in July
Australian Assistant Treasurer Daniel Mulino has acknowledged that he was aware of the Australian Taxation Office’s plans to restrict credit card payments before the policy became a public issue. The admission has raised questions about when the government was informed, how the proposed changes were communicated, and what they could mean for taxpayers who rely on credit cards to pay tax liabilities. The issue highlights the importance of transparency, clear public communication, and accountability in government decision making.
OPINION & VOICES
Daniel Mulino Acknowledges Government Knew About ATO Credit Card Plans in July
Australian Assistant Treasurer Daniel Mulino has acknowledged that the federal government knew in July that the Australian Taxation Office was considering stopping credit card payments for tax bills, months before the proposal became public. His admission has intensified questions about how the decision was handled and why small businesses were not informed earlier.
The issue emerged after the ATO announced in late September that it intended to stop accepting credit card payments from December 1, 2026. The announcement triggered criticism from business groups and taxpayers who rely on credit cards to manage cash flow and meet tax obligations.
Speaking on ABC's Insiders on October 18, Mulino confirmed that he and Treasurer Jim Chalmers became aware of the ATO's preference in July. He said the government had encouraged the agency to continue discussions with credit card companies and provide a transition period.
Why the ATO Planned to Stop Accepting Credit Cards
The proposed change is connected to Australia's credit card surcharge reforms. From October 1, 2026, new rules prohibit surcharges on debit and credit card payments, meaning businesses can no longer pass those transaction costs directly to customers in the same way.
For the ATO, accepting credit card payments without a sufficiently low processing fee could create a substantial financial burden. The tax office has estimated that absorbing the costs could amount to approximately $200 million annually.
The ATO argued that continuing to absorb those expenses would have consequences for its budget and the funding available for public services. It explored options, including negotiations with credit card companies, but did not secure fees low enough to make the existing arrangement financially sustainable.
The issue therefore involves competing priorities. Consumer surcharge reforms are intended to reduce additional charges at the point of purchase, while government agencies must determine how to manage the transaction costs that remain.
Why the July Admission Matters
The timing of the government's awareness has become a central point of debate. Small businesses were informed of the proposed change on September 30, shortly before the announcement became public.
Mulino's admission confirms that the government knew about the ATO's preferred approach roughly two months earlier. Critics may question whether that period could have been used to communicate with affected businesses, explore alternatives, or prepare a more gradual transition.
Mulino has defended the government's approach, saying it instructed the ATO to keep negotiating with credit card companies and ensure a transition period. He also argued that the government responded quickly when feedback showed that the original timeframe was insufficient.
The distinction is important. Knowing that an agency is considering a policy is not necessarily the same as approving a final decision. However, the disclosure raises legitimate questions about how the government assessed the likely impact on businesses before the plan was announced.
Small Businesses Face Cash Flow Concerns
For many small businesses, credit cards are more than a convenient payment option. They can provide short term flexibility when tax bills arrive before customer payments or other revenue has been received.
Removing that option too quickly could make it harder for some businesses to manage the timing of their payments. Companies operating with tight margins may need to adjust their budgeting, maintain larger cash reserves, or seek alternative payment arrangements.
Industry representatives have warned that the proposed change could place additional pressure on businesses already dealing with operating costs and financial uncertainty. The impact will vary, however, because not every business uses credit cards to pay tax.
The government has said that just over two per cent of individual taxpayers and around five per cent of small businesses used credit cards for ATO payments in the 2024 to 2025 financial year.
Although these figures represent a minority of taxpayers, the consequences could be significant for those who depend on the option.
Government Steps In to Delay the Change
Following strong feedback from the business community, the federal government announced on October 9 that it would temporarily fund the cost of accepting credit card payments.
Under the revised arrangement, the ATO will continue accepting credit card payments until June 30, 2027. The extension is intended to give businesses and individuals more time to prepare while the government and tax office explore alternative arrangements.
The government has also asked the ATO to consult on support for taxpayers experiencing financial hardship and identify options for people and businesses that may struggle to use other payment methods.
After the transition period, credit card payments through third party providers are expected to remain available, alongside debit cards and bank transfers. These alternatives may involve different costs and conditions, so taxpayers will need clear information before choosing how to pay.
The extension provides temporary relief, but it does not completely resolve the longer term questions about payment fees and access.
Accountability and Communication Under Scrutiny
The controversy has become a broader discussion about communication between government departments, ministers, businesses, and the public.
When a policy could affect how businesses meet legal financial obligations, early communication can help those affected prepare. It also gives policymakers an opportunity to identify unintended consequences before implementation.
The government's position is that it encouraged negotiations and allowed for a transition period. Critics, meanwhile, may argue that the initial transition was too short and that earlier engagement with business groups could have helped prevent the backlash.
The central issue is not simply when ministers first learned about the proposal. It is whether the information available at the time was used effectively to assess the consequences and develop a practical implementation plan.
What Happens Next?
The immediate pressure has eased because the government has extended the period in which credit card payments can be made to the ATO. However, the longer term arrangement remains an important issue for businesses and taxpayers.
Further consultation will need to address processing costs, payment alternatives, and the needs of taxpayers who depend on credit cards to manage cash flow. Clear guidance will be essential so that affected people have sufficient time to adapt.
Mulino's admission has brought the timeline of the decision into sharper focus. As discussions continue, the government's handling of the issue will be judged not only by its response to criticism but also by whether the final arrangements provide practical, transparent, and financially workable options.
For small businesses, the priority is certainty. For taxpayers, it is access to reliable payment methods. For the government, the challenge is balancing those needs with the financial realities of administering the tax system.
DailyWAOnline will continue to follow developments in Australian economic policy and their implications for businesses, taxpayers, and the wider community.
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